Fidelity Investments launches real-time fractional shares trading

Maria Nikolova

The simplified way of investing is being rolled out to Fidelity’s retail customers beginning today.

Online brokerage Fidelity Investments today announced availability of real-time fractional shares trading of stocks and ETFs.

This simplified way of investing, also known as dollar-based investing, is being rolled out to Fidelity’s retail customers beginning today and will continue over the next several weeks. It allows investors to trade as little as 0.001 of a share using Fidelity’s Mobile app for iOS and Android.

Fidelity will execute all fractional trades in real-time during market hours, meaning customers will always know the share price. Fractional share or dollar-based trades, which must be market or limit order types and are good for the day only, are available in eligible Fidelity retail accounts, including brokerage, HSAs, IRAs, and self- directed brokerage accounts via a workplace retirement plan.

The brokerage expects investors to use dollar-based trading in a variety of ways. For instance, a customer saves $500 to begin investing in several high-priced companies they have been following for their diversified portfolio. With this new capability the price of a single share is not a concern, and the investor buys $100 worth of shares in five different companies, potentially helping with diversification.

In the fall of last year, another electronic trading major – Interactive Brokers, enabled fractional share trading on its TWS platform.

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